Autoport dinged $10,000 a day for damaged BMWs

The Autoport Halifax Terminal in Eastern Passage is seen in this photo taken on March 5, 2015.

Halifax’s Autoport has to foot the $10,000-per-day bill for the storage and preservation of 2,500 damaged BMWs, an Ontario court has ruled.

The recent Ontario Divisional Court ruling overrides a previous decision, which was appealed by BMW, ordering the luxury automaker to pay.

It’s all part of a much larger lawsuit: BMW is suing Autoport for $175 million over allegations that improper storage led to the damage of 2,966 BMW and MINI via exposure to excessive ice, water and salt during the winter of 2015.

The July 2015 recall notice from Transport Canada warned that certain MINI and BMW models that were parked at the port of entry in Halifax during the ice storms in February 2015 may have experienced corrosion due to salt and water exposure, and should be inspected for a number of possibly related safety defects including auto-shutdown issues, steering problems, and fire risk.

According to court documents Autoport denies that most of the 2,966 automobiles were exposed to the severe winter weather conditions or corrosive salt, and disputes the weather’s effect on the vehicles that were exposed. Autoport disputes the reasonableness of the recall in these circumstances and BMW’s theory of damages. Additionally, Autoport argues that if any of the BMW vehicles were defective, the defect had nothing to do with the damage alleged to have occurred at the Autoport storage facility.

As for who should pay for storage of the damaged vehicles, BMW takes the position that it doesn’t need the vehicles for the lawsuit as their damages claim does not turn on proving actual harm to any particular vehicle. BMW has argued that since none of the vehicles can be determined to be roadworthy, it cannot sell them and wants to destroy them.

“The existence or extent of the harm to any particular vehicle can only be determined through extensive destructive testing, meaning that no vehicle can be shown to be roadworthy without effectively destroying it,” the court documents read.

BMW takes the position that Autoport can have as many of the 2,500 remaining vehicles as it wants, and perform whatever inspections or tests it may consider necessary in its defence.

Meanwhile, Autoport alleges it has repeatedly requested information from BMW regarding the nature of the damage and BMW’s own inspections of the vehicles. Autoport argues that without information from BMW it cannot identify the expertise required and cannot proceed with meaningful inspections of the vehicles. Autoport also says it can’t prepare an inspection and testing protocol, nor can it arrive at a sample size for testing or determine whether there are alternatives to destructive testing without disclosure from BMW.

Autoport has had 12 vehicles inspected by experts, but no damage was found and the tested vehicles operated normally.

In the decision, the appeal judge wrote that the court is satisfied that Autoport’s own experts can determine how many vehicles they need to preserve and test, and “logic and the principle of proportionality suggest that it will be substantially fewer than the 2,500 vehicles currently in storage.”

“Placing the financial burden on the defendant gives the defendant an economic incentive to preserve and test only as many automobiles as it actually requires for its defence. In contrast, placing the financial burden on the plaintiff would give the defendant an economic incentive to delay its testing and exaggerate the number of vehicles to be preserved,” the decision reads.

The decision rules that Autoport is to pay to BMW the costs of storing the vehicles to date.